Will a uni degree be really worth it?

May 17 2003

John Howard has deliberately chosen to shift from public to private funding, writes Gay Alcorn.

"We are moving towards an American-style education system," says Labor's Jenny Macklin. That's code for abandoning egalitarianism. (How many times can something be abandoned, by the way?) It's code for a "two-tier" system, one for rich kids, one for the rest. The Australian style, some time ago at least, was for equality of opportunity, especially for children.

The American bogey doesn't resonate like it once did. We're just as fat as the Americans, after all, and we love four-wheel-drives just like they do. And, as it happens, the "set the universities free" package would make our education system even more elitist than theirs.

The interesting question is how Australians will respond to John Howard's repeated statement that because only "30 per cent of Australian boys and girls" go to university, they should pay more for their own education. (Actually, 45 per cent attend university at some stage in their lives.) The Prime Minister has been successful in shifting Australian culture towards embracing individual responsibility. But this is education, which we like to think is the way we even out privilege, not perfectly, but somewhat. Do we want and will we pay for a national education system, or one in which individuals, increasingly, pay their own way?

Howard is good at exploiting "battler" resentments, but if Labor is capable of articulating what it believes in, perhaps struggling Australians will realise that they stand to be the losers. It's the battlers' kids who will be even less likely to go to university and, if they get there, they will be the ones who receive a second-rate degree from an institution that can't extract big fees.

The American system is more interesting than we think and, in some ways, less elitist than our own. (Melbourne University, for one, thinks that moving to a US model is a good idea.) Despite perceptions, 80 per cent of American school leavers go to publicly funded universities, many of which are excellent. Like here, a university education is virtually a universal middle-class aspiration (and increasingly, a working-class one, too). There are fine reasons for that - college graduates earn on average $US1 million ($A1.5 million) more in their lifetimes than high school graduates.");document.write("

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There is huge anxiety about the cost of college, and the ballooning debt all but the wealthy are shouldering. The average yearly tuition is $US4081. The New York Times reported this month that a graduate student carries an average $US27,500 in debt, more than three times the amount it was a decade ago. That's comparable to Australia, where HECS now ranges from $3680 a year for arts students to $6136 for medical students. (If the package is passed, universities will be able to raise HECS fees by a third.)

The new scheme would double the places for full-fee-paying students from a maximum of 25 per cent of a course to half. That's where we're going - more students paying the full cost of their own educations. Melbourne University now charges $80,000 for a full-fee law degree. That sounds pretty much like the US. The Age's 26-year-old researcher in Washington had a $US80,000 debt for a law degree at a prestigious university (much to her mother's dismay, she decided she didn't want to be a lawyer). Overall, says the head of Monash's Centre for Research in International Education, Simon Marginson, American higher education fees are lower than Australia's.

The proposed scheme has some equity advantages, like deferring repayments until earnings reach $30,000. But consider this. In the US, only 9 per cent of secondary school students attend a private school. It's mass public education until the tertiary level. Here, 30 per cent go to private schools, in part a result of anxiety about state education. The other key difference is America's well-established system of scholarships and endowments for needy tertiary students.

What Australia under Howard has done is to shift from public funding to private funding; and that's been a choice, not a necessity. In 1983, 90per cent of tertiary funding came from government; in 1999, 53 per cent was from government and it's now dropped below half. In Britain, 63 per cent is public money and, in Canada it's 60 per cent.

The prestigious universities such as Melbourne have accepted the package because, starved for public funds for years, they will benefit from increased HECS for desirable courses and from more full-fee students. The second-tier universities, like LaTrobe and Deakin, will suffer, because they won't be able to increase their fees. Universities like RMIT, Marginson argues, will "wither".

A university education is still worth it, isn't it? The US National Centre for Higher Education found that poor families were now spending a quarter of their annual income on college education, up from 13 per cent in 1984. For the middle class, it leapt from 4 per cent of annual income, to 7 per cent.

In the US, lower-income people now doubt whether it's worth it. Is that what Australians really want?